Tag Archives: European political risk

While markets have remained stoic about evolving political situation in the region, prolonged uncertainty could have an impact.The response given by the Catalan President Carles Puigdemont to the Spanish government’s ultimatum last week did not provide the clarity the central government was seeking on whether or not the Catalan parliament would formally declare independence.As a result, the central government therefore has decided to invoke Article 155 of the Spanish constitution, for the...

There are increasing chances that Madrid will impose direct rule on Catalonia. A prolonged stand-off could end up depressing activity, but for now we are not revising our growth outlook for Spain.This morning, the Catalan president failed to answer clearly whether Catalonia had declared independence or not. He reiterated that he had placed last week’s unilateral declaration of independence on hold in order to open up a “two-month process” to try to reach a deal with the central...

Against the backdrop of a charged political climate, greater flexibility on debt and deficit rules plus ECB largesse are helping national economies We are entering a period of heightened political risk across many countries in Europe, marked by the progress of populism, as seen in the surge of support for non-mainstream parties. Not only do we have the Brexit referendum on June 23, but three days later there will be a re-run of the Spanish general election. We still expect strong Spanish...